Britain backs Rolls-Royce mini nuclear plants in net zero quest

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LONDON (Businesshala) – Britain has backed a $546 million Rolls-Royce funding round to develop the country’s first small modular nuclear reactor to reach net zero carbon emissions and promote new technology with export potential.

FILE PHOTO: The Rolls-Royce logo is featured at the World Nuclear Exhibition (WNE), the trade fair event for the global nuclear community, in Villepinte near Paris, France, June 27, 2018. Businesshala/Benoit Tessier/File photo

Achieving this target by 2050 will require massive increases in low-carbon electricity generation such as wind, solar and nuclear, but while large-scale new nuclear projects have struggled for funding, Britain is now banking on smaller volumes. Has been doing.

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“This is a once in a lifetime opportunity for the UK to deploy more low-carbon energy than ever before and ensure greater energy independence,” Britain’s Trade and Energy Secretary Quasi Quarteng said on Tuesday.

Small modular reactors (SMRs) can be built in factories, with small parts large enough to be carried on trucks and barges and assembled more quickly and inexpensively than large-scale reactors. Each mini plant can generate electricity for about 10 lakh households.

Rolls-Royce estimates that the SMR business could create up to 40,000 jobs, depending on British and export demand.

It said global export potential was “unprecedented”, in line with a government plan to increase clean tech jobs as part of the so-called green industrial revolution.

Britain wants to reduce gas-generated electricity, a desire strengthened by this year’s dramatic price hike, which has resulted in shortages at many smaller energy suppliers. But SMRs will not be available until the early 2030s.

Britain will invest £210 million ($283 million) over three years from Rolls-Royce and two partners, BNF Resources UK and Exelon Generation, with £195 million ($263 million). Rolls will own about 80% of the new unit Rolls-Royce SMR.

investor signals

Rolls-Royce shares rose 4% on news of a vote of confidence in the aero-engineer’s SMR business. Its stock is already up 33% this year, on hopes that the worst of the COVID-19 aviation slowdown is now behind it.

The new funding will enable SMR technology to take the next steps through the UK regulatory process, and identify sites for the plants, which will be about the size of two soccer fields.

“(This) sends a big signal to private investors that the government wants new large-scale stations to have zero SMRs as well,” said Tom Greatrex, chief executive of the Nuclear Industry Association. Treats nuclear as a green technology.

Citi analysts noted that Rolls-Royce previously estimated that the UK may need around 16 SMRs between 2030 and 2050 to replace older plants, adding that the unit should promote the company more broadly. can.

“There is a long-term trade, international opportunity and potentially other uses, such as green hydrogen production, which could be used in synthetic aviation fuels and desalination in dry areas,” he said.

But Agency Partners analyst Nick Cunningham was less convinced.

He said, “The UK will be building some Rolls-Royce SMRs over a period of a few years before they become obsolete by new technology and overtaken by policy changes, and this will barely move the dial for Rolls-Royce investors.” will increase.”

($1 = 0.7414 pounds)

Reporting by Susanna Twidel and Sarah Young; Editing by Alexander Smith

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